Jes Staley will succeed Antony Jenkins as chief executive of Barclays
Jes Staley, Barclays chief executive © Bloomberg; FT montage

Barclays has announced that Jes Staley will start as its new chief executive on December 1, with the veteran Wall Street banker earning as much as £8.25m a year as well as a “golden handshake” of £1.93m to buy out a previous bonus.

Mr Staley’s arrival at Barclays is likely to mark an acceleration of the restructuring strategy pursued by the UK bank over the past few years, particularly in retreating from underperforming parts of its investment bank.

Mr Staley said in a memo to staff that he planned “to complete the necessary transformation and repositioning of the investment bank to a less capital intensive model”.

After rising to the top tier of managers at JPMorgan Chase over more than 30 years, Mr Staley’s appointment has been seen by some analysts as a sign that Barclays could return to an ambitious expansion strategy in investment banking. But both he and the bank sought to play this down on Wednesday.

Barclays’ chairman John McFarlane — who has been running the bank since firing the last chief executive in July — said Mr Staley had “the appropriate leadership talent and wide-ranging experience to deliver shareholder value and to take the group forward strategically”.

“In particular, he understands corporate and investment banking well, the repositioning of which is one of our major priorities,” said Mr McFarlane. “After an extended process, I now know Jes well, and we are in agreement on the way forward.”

Barclays said it would pay Mr Staley a salary of £1.2m, role-based pay of £1.15m in shares and a cash payment equal to a third of salary in lieu of pension. On top of this £2.75m of fixed pay he could get a bonus of up to £2.2m and a long-term incentive programme share award of up to £3.3m.

He will also receive a one-off payment to compensate him for the final part of a deferred bonus he is owed by JPMorgan, which Barclays said was worth £1.93m based on the US bank’s latest share price. The UK bank had considered delaying his start date until after he received the share award in January.

The Boston-born banker will receive an unspecified allowance to cover the cost of moving his family from New York to London.

Mr Staley was approved by UK regulators on Tuesday after being formally interviewed last week by Andrew Bailey, the head of the Bank of England’s Prudential Regulation Authority.

The incoming chief executive told Barclays staff that he was committed to completing “the cultural transformation of the group” and to improving its relations with regulators after the bank’s reputation was damaged by a string of scandals including its involvement in Libor interest rate rigging.

“There can be no retreat from becoming a values driven organisation which conducts itself with integrity at all times,” he said. “My ambition is to restore Barclays to its rightful standing — successful, admired and well regarded by all.”

He added that his priority would be boosting the bank’s flagging financial performance: “We are a commercial enterprise and must generate attractive returns for our shareholders. They have been patient and now we must deliver for them.” Barclays shares were down slightly in line with the sector at 250p in late morning trading.

Investors have greeted news of the move with caution amid uncertainty over the implications of the change for the group’s three-year-old strategy of paring back its underperforming investment bank.

Barclays last year announced plans to shrink the investment bank from using half the group’s capital to only a third and to cut 19,000 of its 140,000 jobs.

Mr Staley is expected to oversee an acceleration of this retrenchment by exiting from securities trading operations in much of Asia, Latin America and continental Europe. He will also need to grapple with the UK’s “ringfencing” law that requires it to separate its retail and investment banking units into two standalone entities.

He sought to reassure employees in most parts of the bank, saying: “We have a great position in personal and corporate banking and we will lead the digital revolution sweeping through that world. Our business in Africa gives us exciting opportunities in fast growing economies. We will complete the necessary transformation and repositioning of the investment bank to a less capital intensive model. And we will support the growth of our world leading payments business in Barclaycard.”

The appointment of the former JPMorgan executive, who has been working for BlueMountain Capital over the past three years, underlines how the British political climate has in recent months shifted back in favour of the City of London.

Mr Staley was approached three years ago by Barclays about becoming its chief executive to replace Bob Diamond, the investment banker ousted by the regulator over the Libor interest rate rigging scandal.

But Barclays then feared a backlash against hiring another US investment banker and opted instead to promote Antony Jenkins, its head of retail banking. He went on to be dubbed “Saint Antony” for his attempt to clean up the bank’s culture before being fired this year.

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